It is a sailing term, when the sail is full of wind the boat moves forward, however, if another boat comes along side it will take the wind from the first boat. In this case the first boat slows or stops while the other boat accelerates. So "taking the wind out of the sail" stops one boat, while the other continues. So for a person, going about their daily chores or work, they have to stop and re-evaluate what to do next.

It usually means to reduce the momentum of something. However in this case the author tells you what he means. The information before the ....tells you what the author means.